Canadian Mortgage Calculator
Calculate your mortgage payments, total interest paid, and full amortization schedule. Built for Canadian mortgages with semi-annual compounding.
Your Mortgage Details
How to use this calculator
- Enter the home purchase price.
- Enter your down payment ($ or %).
- Enter your mortgage interest rate.
- Select your amortization period and payment frequency.
- Click Calculate Mortgage.
Quick start with a preset:
Your Results
Enter your mortgage details and click Calculate Mortgage to see your results.
Monthly Payment
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Principal vs. Interest Breakdown
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Understanding Your Canadian Mortgage
🇨🇦 Semi-Annual Compounding
Canadian mortgages are legally required to compound semi-annually (twice per year) under the Interest Act of Canada. This is different from US mortgages, which compound monthly. This calculator uses the correct Canadian formula to convert your nominal annual rate to an effective monthly rate, giving you accurate payment amounts.
🔢 Worked Example: $600,000 Mortgage at 5.25%
A first-time buyer in Ontario purchases a $750,000 home with 20% down ($150,000), taking a $600,000 mortgage at 5.25% over a 25-year amortization:
Switching from monthly to accelerated bi-weekly payments saves approximately $58,000 in interest and pays off the mortgage about 2.7 years early — with no change to the mortgage contract, just the payment frequency. This is one of the highest-return, zero-risk financial moves available to Canadian homeowners.
⚡ Accelerated Bi-Weekly Payments
Accelerated bi-weekly payments are calculated as half your equivalent monthly payment, paid every two weeks. Because there are 26 bi-weekly periods per year (not 24), you effectively make one extra monthly payment per year. This can shave years off your amortization and save tens of thousands in interest over the life of your mortgage.
🏦 CMHC Mortgage Insurance
If your down payment is less than 20% of the purchase price, CMHC (Canada Mortgage and Housing Corporation) mortgage default insurance is required by law. The premium ranges from 2.80% to 4.00% of the mortgage amount and is typically added directly to your mortgage balance. You pay it off over the life of your mortgage, not upfront.
💰 Minimum Down Payment Rules
In Canada, the minimum down payment depends on the purchase price: 5% for homes under $500,000; 5% on the first $500,000 plus 10% on the remainder for homes between $500,000 and $999,999; and 20% for homes $1,000,000 or more. Homes over $1M do not qualify for CMHC insurance regardless of down payment.
📅 Mortgage Terms vs Amortization
Your mortgage term (typically 1–5 years) is how long your current interest rate is locked in. Your amortization period (typically 25 years) is how long it would take to pay off the entire mortgage. At the end of each term, you renew at current rates. Most Canadians renew their mortgage 4–5 times over the life of a 25-year amortization.
📉 How to Pay Your Mortgage Off Faster
Three of the most effective strategies: switch to accelerated bi-weekly payments (saves years off your amortization), make lump sum prepayments on renewal (most mortgages allow 10–20% per year), and increase your payment amount slightly above the minimum. Even $100/month extra on a $500,000 mortgage can save over $30,000 in interest and cut years off your timeline.
🔄 Fixed vs Variable Rate Mortgages in Canada
Fixed-rate mortgages lock in your interest rate for the entire term — typically 5 years in Canada — giving you predictable payments and protection against rate increases. Variable-rate mortgages move with the Bank of Canada's prime rate, meaning your payments can change with monetary policy decisions. Historically, variable rates have been lower than fixed rates over the long run, but they carry risk during rising-rate environments. Most Canadian mortgages have a 5-year term with a 25-year amortization, meaning you will renew your mortgage multiple times over its life. At each renewal, you negotiate a new rate — this is often when Canadians can save the most by shopping across lenders.
🏦 Mortgage Stress Test in Canada
Since 2018, all Canadian homebuyers — even those with a 20% down payment — must pass the federal mortgage stress test. This requires qualifying at the higher of either your contract rate plus 2%, or 5.25%, whichever is greater. For example, if your lender offers you 4.5%, you must prove you could afford payments at 6.5%. This rule was designed to ensure borrowers can still afford their mortgage if rates rise. The stress test applies to federally regulated lenders like major banks, but not to credit unions or private lenders in all provinces — though many apply similar standards voluntarily.
❓ Frequently Asked Questions
What is the maximum amortization in Canada?
For insured mortgages (down payment under 20%), the maximum amortization is 25 years for existing homes and 30 years for new builds and first-time buyers as of late 2024 rule changes. For uninsured mortgages (20% or more down), there is no federally mandated maximum, though most lenders cap at 30 years. A longer amortization means lower monthly payments but significantly more interest paid over the life of the mortgage.
What closing costs should I budget for?
Beyond your down payment, budget 1.5–4% of the purchase price for closing costs. These include land transfer tax (provincial and municipal in Toronto), legal fees ($1,500–$2,500), home inspection ($400–$600), title insurance ($300–$500), and property tax adjustments. First-time buyers in most provinces receive a land transfer tax rebate that reduces these costs significantly. Use our First Home Buyer Cost Calculator for a full breakdown.
Can I break my mortgage early?
Yes, but you will typically pay a prepayment penalty. For variable-rate mortgages, the penalty is usually 3 months of interest. For fixed-rate mortgages, lenders charge the greater of 3 months' interest or the Interest Rate Differential (IRD) — which can be thousands of dollars in a falling-rate environment. Always calculate the break-even before breaking your mortgage to refinance at a lower rate.
How much mortgage can I qualify for in Canada?
Canadian lenders use two ratios. The Gross Debt Service (GDS) ratio — your mortgage payment, property tax, and heating costs divided by gross income — must not exceed 39%. The Total Debt Service (TDS) ratio — all debt payments including the mortgage divided by gross income — must not exceed 44%. You must also pass the stress test at your rate plus 2% or 5.25%, whichever is higher. Use our Mortgage Affordability Calculator to see your maximum purchase price.
Should I choose a fixed or variable mortgage rate in 2026?
Fixed rates provide certainty — your payment won't change for the term, making budgeting straightforward. Variable rates move with the Bank of Canada's prime rate and have historically been lower than fixed rates over the long run, but carry short-term risk. In 2026, with the Bank of Canada having cut rates from 2023 highs, many Canadians are weighing whether to lock in at current fixed rates or take a variable rate expecting further cuts. Your risk tolerance and budget flexibility should drive the decision more than rate predictions.
How does a mortgage renewal work in Canada?
At the end of your mortgage term (typically 5 years), your mortgage comes up for renewal. You can renew with your current lender at their posted rates or switch to a new lender for a better rate. Switching lenders at renewal does not require re-qualifying under the stress test as of 2024 rule changes — you can move your existing balance to another insured lender without the stress test applying. Shopping your renewal is one of the most impactful financial decisions homeowners make, as a 0.5% difference on a $500,000 mortgage saves over $15,000 in interest over a 5-year term.